Schwendimann v. Neenah, Inc., et al., Nos. 2022-1333, -1334, -1427, -1432 (Fed. Cir. (PTAB) Oct. 6, 2023). Opinion by Clevenger, joined by Prost and Cunningham.
Schwendimann owns a series of patents related to transfer sheets and methods for transferring images onto dark-colored fabrics. After Schwendimann sued Neenah for infringement, Neenah filed IPR petitions asserting that claims in five of the patents were unpatentable as obvious in view of the prior art, including the combination of “Kronzer” and “Oez.” The Patent Trial and Appeal Board instituted review as to four of the patents and found the challenged claims unpatentable as obvious over Kronzer in view of Oez. In so ruling, the Board rejected Schwendimann’s arguments relating to a motivation to combine and a reasonable expectation of success. Schwendimann appealed.
On appeal, Schwendimann argued that substantial evidence does not support the Board’s finding of a motivation to combine Kronzer and Oez or the Board’s finding that a skilled artisan would have had a reasonable expectation of success. The Federal Circuit disagreed. As for a motivation to combine, the Federal Circuit agreed with the Board that the motivation “comes from the express teachings in both references.” Expert testimony also supported the Board’s finding.
Next, the Federal Circuit rejected Schwendimann’s arguments that Oez taught away from any combination with Kronzer, that the combination would be unpredictable, and that it would require significant reengineering. In the end, the Federal Circuit concluded that “the Board’s analysis is sound, and substantial evidence supports the Board’s finding that a skilled artisan would use their common sense when making the proposed combination to arrive at an operable transfer sheet.”
Lastly, the Federal Circuit addressed Schwendimann’s argument that neither Neenah nor the Board explained why a skilled person would have chosen Kronzer as the primary reference. The Federal Circuit ruled that Schwendimann had forfeited this argument but, even if not forfeited, “the argument has no basis in our case law.” The court said that “where the relevant factual inquiries underlying an obviousness determination are otherwise clear, characterizing references as ‘primary’ and ‘secondary’ is merely a matter of presentation with no legal significance.” The court acknowledged that precedent indicates “there may be some cases in which relevant factual determinations inhere in such characterization of prior art references,” but the court remarked that Schwendimann “has not brought any such case to our attention, and we could find none.”
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Sisvel International S.A. v. Sierra Wireless, Inc., et al., Nos. 2022-1493, -1547 (Fed. Cir. (PTAB) Oct. 6, 2023). Opinion by Chen, joined by Moore and Clevenger.
Sisvel owns a patent directed to methods of channel coding when transmitting data in radio systems. Sierra Wireless and Telit Cinterion filed an IPR petition challenging claims 1–10 of the patent, asserting that the claims were obvious in view of “Chen” alone or in combination with other prior art references.
The Patent Trial and Appeal Board determined that claims 1–3 and 9 were unpatentable as obvious over Chen, but upheld claims 4–8 and 10. Sisvel appealed the obviousness determination, and Sierra cross-appealed as to the upheld claims.
As for the obviousness determination, the Federal Circuit affirmed because substantial evidence—including Chen’s disclosures and associated expert testimony—supported the Board’s findings. Next, the Federal Circuit disagreed with Sisvel’s argument that the Board’s analysis lacked sufficient detail and ignored certain arguments. The court ruled that the Board’s analysis “is sufficiently detailed, adequately addresses Sisvel’s related arguments, and is supported by substantial evidence.” Thus, the Federal Circuit affirmed the Board’s determination that claims 1–3 and 9 were unpatentable as obvious.
Turning to Sierra’s cross-appeal, the Federal Circuit affirmed-in-part, vacated-in-part, and remanded. First, the Federal Circuit affirmed the Board’s finding of a lack of motivation to combine Chen and other references. The court ruled that the Board’s finding was “more than reasonable in this case,” as Sierra’s “proposed combinations and rationales were expressed at such a nonspecific, high level of generality, they never made clear to the Board what portions of the references were being combined and why a skilled artisan would identify those particular elements for a combination.”
Second, the Federal Circuit addressed the Board’s finding that Sierra failed to identify sufficient algorithmic structure in the patent specification corresponding to a “means for detecting” claim limitation. Before the Board, Sierra relied on certain software protocols mentioned by name in the specification as examples of the corresponding structure, which the parties’ experts agreed were well understood and well known to persons of ordinary skill. The Board found, however, that the specification contained no “algorithm for performing any of these protocols.” Thus, the Board disregarded the expert testimony because when the specification contains no algorithm, “evidence of a skilled artisan’s knowledge is irrelevant.”
The Federal Circuit disagreed with the Board’s view that the specification contains no algorithm. The specification explicitly referenced names of protocols that were known in the art, and “as such, the Board should have considered the knowledge of a skilled artisan to assess whether the protocol name sufficiently discloses an understood algorithm corresponding to the means-plus-function limitation.” The court explained that this “remains true even though the steps corresponding to the protocols are not expressly set out in the specification.” Because the specification identified the protocols, “the Board should have considered expert testimony to shed light on these disclosures.” Doing so “does not allow an expert to create new structure or imply structure from background knowledge—instead, it only reads the existing disclosures in the specification for all they would convey to one skilled in the art.” The Federal Circuit thus remanded for the Board to conduct that analysis.